Pennsylvania may unscrew distillery delivery rules

PITTSBURGH—Pennsylvania's small distilleries, four of which operate in the Pittsburgh area, could soon be shipping directly to at-home customers thanks to a rule change being considered by the state.

The state's Independent Regulatory Review Commission, which reviews and recommends nonlegislative policy changes, and the Pennsylvania Liquor Control Board have been vetting a proposed rule that would "permit licensed limited distilleries and distilleries to deliver their products directly to consumers (and) retail licensees, (similar) to licensed limited wineries."

The proposed policy change originates out of Act 113 of 2011, which was passed in order to give the state's small distilleries "the same privileges enjoyed by licensed limited wineries."

At a meeting set for Feb. 27, the Independent Regulatory Review Commission will have the opportunity to affirm the new regulations based on feedback received from the Liquor Control Board last month. If the commission approves the final version, the new rules would be submitted to the Office of the Attorney General for review and approval, a process that could take up to 30 days.

If the attorney general approves, the new shipping regulations would take effect after being published in the Pennsylvania Bulletin, the state's weekly compendium of departmental rule changes and public notices.

"Assuming all goes well, our best guesstimate for an effective date is mid-April," said PLCB spokeswoman Stacy Kriedeman in an email.

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If that happens, it would be the second major change in liquor shipping rules in the last three months. Since last November, distillers have been able to ship their products directly to licensed bars and restaurants. Before, bars and restaurants that wanted to carry a local craft spirit had to come to the distillery—or order from the state store, if it happened to be in stock.

Tim Russell—head of Strip District-based Allegheny Distilling, which makes Maggie's Farm rum -- said the changes will be a boon for distilleries like his.

"I'm carried in a little more than a dozen restaurants now. Those that do have all made a trip to my isolated part of the Strip," he said. "I had one bar manager in Mount Washington who complimented the quality of rum basically go on to tell me he probably won't carry it because it meant he'd have to drive to the Strip when he already has mostly everything he needs at a nearby state store."

Meredith Grelli—co-owner of Strip District distiller Pittsburgh Distilling Co., which produces Wigle whiskey—said, "The direct shipment to licensees and consumers is critical to our sustainability as a Pittsburgh craft distillery."

The company's "small-batch production style, and focus on developing unique products that may not have mass market appeal, means that much of our portfolio is not well suited to traditional distribution channels."

The old rules "clearly (limited) our footprint," she said.

Pennsylvania has been loosening its rules governing distilleries since 2011, when Act 113 was enacted. That law made it possible for distilleries to sell their product on site, just as the state's wineries were permitted to do.

Shipping rules have been relaxing, too. In 2011, the PLCB launched a program allowing delivery of certain wine and liquor products to home and business addresses for an extra shipping fee.

Still, direct shipping remains a thorny issue in Pennsylvania. Out-of-state farm wineries, which produce limited supplies, still must obtain a "limited winery license" to ship in state; out-of-state spirits distillers still must find Pennsylvania-licensed importers if they want to legally distribute product here, unless they also obtain a limited distillery license or work in partnership with a licensee.

Prior to Act 113, limited distillers were able to provide samples on site, but bottles had to be purchased elsewhere.

The effect of that law has been a sharp jump in the number of limited distillery licenses issued in Pennsylvania.

Currently, there are 27 such licenses in circulation—14 of them are active and six are pending, with the rest either inactive or in "safe-keeping" waiting to be activated.

Besides Wigle and Maggie's Farm, Western Pennsylvania now has Pennsylvania Pure, makers of Boyd & Blair vodka in Shaler and Stay Tuned Distillery in Munhall, with Blackbird Distillery in Brookville, Pa., set to open next month. Disobedient Spirits, a would-be whiskey distiller in Homer City, and Conneaut Cellars in Crawford County both have limited distillery licenses in safe-keeping.

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